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U.S. investors’ confidence in domestic capital markets has rebounded,
but their faith in markets outside the United States has continued to
decline, according to new research by the Center for Audit Quality (CAQ).

Sixty-five percent of investors reported that they have some, quite
a bit, or a great deal of confidence in U.S. capital markets in the
sixth annual Main Street Investor Survey released by the CAQ,
which is affiliated with the AICPA. That is an increase of four
percentage points over the previous year.

That percentage had decreased in the 2010 and 2011 surveys; it still
significantly trails the 84% who reported confidence in U.S. markets
in 2007—before the financial crisis.

“This year’s results suggest that confidence about domestic markets
may have stabilized and perhaps even begun to rebound,” CAQ Executive
Director Cindy Fornelli wrote in the introduction to the survey report.

In contrast, confidence in capital markets outside the United States
fell eight percentage points to 35%. The percentage has dropped each
year since 2007, when 65% of investors reported confidence in capital
markets abroad.

The survey, available at tinyurl.com/963u5oo, drew
responses from 1,003 U.S. adults who live in households with $10,000
or more in investments, including stocks, bonds, mutual funds, IRAs,
and 401(k)s.

Investors who indicated little or no confidence in U.S. capital
markets most frequently blamed the state of the economy (37%),
followed by too much government regulation (25%) and weak government
oversight of capital markets (22%).